Best Practices Are Stupid #1 in Canada

March 26, 2012

Currently, Best Practices are Stupid is the best selling business book in Canada.

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Expert Advice? Why You Should Be Skeptical

March 26, 2012

We are constantly bombarded by expert advice from advertisements, books, magazines, TV and the Internet. But how much of this information is actually true? From my experience, there is reason to believe that little of it is accurate. People (often unknowingly) make claims that are exaggerated or in some unfortunate cases, blatant lies.

I remember giving a presentation to a group of eager individuals who were either launching or advancing their speaking careers. During our 90-minute discussion, I provided dozens of tips and techniques for growing their business.

At the end of the evening, one attendee asked, “What is the most important tip?” I thought about this for a minute and replied, “I don’t know.”

Although this answer may sound like a cop out, it is in fact the truth. No one really knows what made them successful. More importantly, they have no idea how others can replicate their success. They may be able to look at a series of events that led to a particular outcome, but most likely the “most important tip” is something completely different than what is seen on the surface.

Several years ago, I attended a “book marketing” conference. It was led by a well-known author who sold millions (and millions) of books. His promise was to share the steps and tools that made him successful so that others could replicate and reap the same rewards. Over the years, thousands of people have tried his “formula,” and as far as I can tell, no one has come even close to his level of success. And those achieving some modicum of success mainly did so by leveraging this author’s name and network.

I am not implying that these experts are misleading or malicious. Not at all. The issue lies in our inability to find the correct correlations between cause and effect. Too many hidden factors play a major role—ones that we might never consider or notice.

Many experts use anecdotal evidence to support their conclusions: It worked for me and a few of my buddies, so it should work for you. This isn’t the most sound reasoning. Maybe the expert’s 10 Steps to Financial Wealth were not the true causes of their success. Maybe success was coincidental. Without more data, it is impossible to know. If 100 people tried the same 10 steps and each got the same results, then you might be able to claim a correlation. While there may be wisdom in anecdotal evidence, you shouldn’t blindly accept it as the truth.

There are many, harder to measure factors that often play a substantial role. Your attitude plays a larger part than you might think. Your Rolodex of contacts (for the younger readers, this is where the old-timers stored our addresses before computers) can be a huge factor in the equation. Being in the right place at the right time has launched many businesses, including Microsoft. Or sometimes, plain old dumb luck is the real cause.

So, how can you separate the accurate from the invalid? One way is to understand the difference between causality, correlation and coincidence.

I recall a study that claimed, “Individuals with greater wealth are happier.” Assuming that this statement is true, it is a correlation. Wealth and happiness are related. However, after reading this, some immediately jump to the conclusion that “money makes people happy.” This statement is causality suggesting that money is the cause of people’s happiness. According to this study though, this is not true. The research indicated that money did not make people happier. Happy people attracted more wealth into their lives. Money is correlated to happiness but is not the cause of happiness.

Beyond causality, correlation and coincidence, there is another factor: conditions. Just because something works for one company does not necessarily mean it will work for yours, even if there truly is a cause and effect relationship.

Read the rest of this article on the American Express OPEN Forum

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My O-The Oprah Magazine Article

March 16, 2012

As readers of this blog know, back in November 2005, I was on the cover of O Magazine.  No, my face was not on the magazine. But an article talking about my Goal-Free Living philosophy was featured on the cover. The picture to the right is the actual cover from back then. You will notice an article titled, “What the Happiest People Know for Sure (page 87).”  That is my article.

And now, after over 6 years, the article is online for everyone to read.

Some of you may remember an article I wrote for the American Express OPEN Forum, the title of which implied being in O “hurt” my business.  Yes, I chose a very provocative title to stimulate interest and discussion, and I succeeded.  For quite some time it was the most commented and viewed article on the entire AMEX site.  It was controversial. And yet I am convinced that many people did not really read the article and immediately jumped to conclusions.  I made it VERY clear that being in O Magazine had nothing (or at least very little) to do with the downturn of my business over a half dozen years ago.

My good friend Jane Atkinson often says, “Pick a lane and stay there.”  That is, choose an area of expertise and stay hyper-focused on that.  At that point in my career, I was operating my business like a drunk driver: changing lanes and confusing my clients and prospects.  I was an innovation expert featured in The New York Times. And at the same time, I was writing about not having goals (my Goal-Free Living book) and was featured in Oprah’s magazine.  My corporate clients began to question my dedication to innovation and big business.  And my prospects were confused by my lack of focus.  As Jane also says, “A confused buyer never buys.”  And so my business suffered at that time – not because of a magazine article, but rather a lack of focus on my part.

I want to make it clear: I am SO proud of being featured in O-The Oprah Magazine.  And I am thrilled that my article, after all of these years, is now available for everyone to read.


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eCornell and Webinar

March 14, 2012

Innovation Book of the YearI recently gave an hour-long webinar for eCornell and  Over 3,000 people registered for only 1,000 slots, maxing out the system.  Thousands of people were unable to attend, so they made the recording available to everyone.

I discussed some of the key concepts from my book, “Best Practices Are Stupid.”

Watch this wildly popular webinar by clicking here.

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Why the Pyramids Are One of the Seven Wonders

March 13, 2012

Innovation at USAANormally we don’t do this.

We have not yet posted an entire tip to this blog.  Yet, at the request of one of my clients, the publisher has agreed to let us do it…just this one time.

USAA is one of the coolest and most interesting financial services companies out there.  Every year they appear on Business Week’s list of best customer service organizations.  And they are innovating the way they innovate.

This tip describes the way they leverage organization structure to drive innovation.  Enjoy and feel free to share the pdf.

****  Download the pdf here  ****

Why the Pyramids Are One of the Seven Wonders

The Innovation PyramidMost companies start their innovation efforts by creating a new corporate function charged with delivering innovation. These functions are composed of employees who are reassigned to and dedicated to this new organization within the company. In most cases, this is a complete waste of time and money. This model keeps innovation separate from the rest of the business, and there is no involvement by the people who make the important decisions. Additionally, the innovation efforts remain out of touch with the real needs of the business.

Recognizing this common dilemma, USAA, a 22,600-employee financial service firm, took a completely different approach.

At USAA, innovation starts at the leadership level. Leadership sets the tone for the rest of the organization and is a strong advocate for innovative thinking. Next, USAA created a “core team” composed of thirty-five individuals, all of whom dedicate 100 percent of their time to innovation. However, here is the twist: Only ten of those individuals report directly to the innovation leadership. The other twenty-five “matrixed” individuals spend their time solely on innovation-related activities, yet with a focus on the specific innovation needs of their line of business. This creates widespread buy-in.

What USAA realized was that thirty-five people could not change the culture of a 22,600-person organization. Therefore, beyond the core team, it created a network of two hundred “innovation advisers,” each of whom spends 10 percent of their time on innovation efforts, working closely with the core team.  In addition, there are ten “innovation champions.” These are leaders who serve as powerful advocates for innovation and help break through any challenges that might pop.

How can you use this same method to accelerate your innovation efforts?

First, make sure your leadership team is on board, as they will set the tone, demonstrate strong executive support, and help challenge the status quo.

Of course, your leadership cannot create a culture of innovation on their own, as they have far too many other responsibilities.  Therefore, most organizations tag someone as a full-time “innovation leader” whose role is to help shepherd the innovation process.  Innovation leaders are different from other leaders within the organization in that they do not have direct authority over those who make innovation a reality. Ultimately, everyone in the company plays an important role in driving innovation. The innovation leader is more of a mentor, coach, and negotiator than a boss or taskmaster. Their ability to influence and sell the value of innovation and its practices is paramount to their and the organization’s success.

Next, create your innovation “core team” (sometimes referred to as a center of excellence), a small cadre of people dedicated to driving innovation into every corner of your organization. In smaller companies made up of few geographies or lines of business, this can indeed be a small central group. But in larger, more widely distributed organizations, the matrixed strategy is preferred, as it addresses the complexities associated with geographic, product, and customer differences.

This core team has many responsibilities. Some of them involve the basics: generating awareness, building the necessary infrastructure, selecting tools, creating training materials and plans, and developing a process for managing the innovation pipeline. But their more valuable role is serving as the eyes and ears of your innovation efforts, providing insights into the specific needs of their departments, employees, customers, vendors, and other stakeholders. They serve as advocates and mentors for innovation, bringing innovation to the masses. They are typically responsible for the development and delivery of innovation/creativity training. They also run brainstorming sessions for various departments. And they play an important role in identifying and shepherding challenges that may exist inside the organization. In essence, they are the go-to people when innovation is needed.

But no core team alone can ever make innovation pervasive. The next step is to pull together your ambassador network. Although all of these individuals are deployed to the lines of business, they must be passionate about innovation. Quite often, these people may dedicate as much as six hours per week (15 percent of their time) to innovation activities. This helps spread the innovation message even deeper into the organization. Since these individuals play such a critical role, contribution to innovation should be one of their performance measures.

How large should your ambassador network be? According to studies conducted by scientist Robin Dunbar, individuals have the capacity to maintain stable relationships with around 150 people. If we use this capacity as a baseline for determining a maximum sphere of influence, having one person in your network for every 150 people you wish to impact (or 0.07 percent) would be appropriate, but 1 percent is a good rule of thumb. At USAA, between the core team and the innovation advisers, almost exactly 1 percent of the organization is represented.

At USAA this approach has worked incredibly well. In only one year, the company achieved 84 percent employee participation (yes, you read that correctly) and implemented approximately one hundred employee solutions. What were the bottom-line results? There was more than ten times ROI for USAA and almost thirty times ROI for USAA members. USAA is different from shareholder companies in that it has a higher goal and motivation for taking care of its members— present and former members of the military services and their families.

These are impressive results. Follow USAA’s lead by embedding innovation throughout the organization.

The Egyptian pyramids worked so well because the majority of the weight was closer to the ground, making these structures more stable. Equally, this pyramid approach to innovation will ground your innovation efforts and fulfill the needs of the business and your customers.

Excerpted from Best Practices Are Stupid by Stephen M. Shapiro by arrangement with Portfolio, a member of Penguin Group (USA), Inc., Copyright (c) Stephen M. Shapiro, 2011.

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Full Length NASA Speech

March 12, 2012

I recently spoke in Houston at NASA’s Johnson Space Center.  For copyright reasons, I can’t post the entire video here.  But you can watch all 81 minutes on NASA’s website. Just click the image below.


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How to Listen Better

March 5, 2012

Friday evening, on JetBlue flight #1696 from Orlando to Boston, we had a bit of a problem.

About an hour outside of Boston, the pilot got on the intercom and told us that the main braking system was not working.  Although the back-up system would probably work just fine, they were preparing us for the worst.

The pilot and flight attendants described the emergency procedures.  They were similar to the ones frequent travelers have heard 1,000 times before, with a few additions (e.g,, brace positions, etc).  But this time, as they walked us through what would happen, you could hear a pin drop on the plane.  Everyone was paying attention.

I was in seat 11F – the emergency exit row, window seat.  As such, I was designated as the person in charge of opening the emergency door if it was needed.  The flight attendant gave me instructions on how to open the door.  She also gave me the code word that the pilot would use if he wanted us to open the emergency exits.

Needless to say, I was listening very carefully.  I studied the charts on how to open the door several times.

Although I am on nearly 100 flights a year, I was listening in a way I never had before.  The truth is, I rarely pay attention to the emergency procedures when we are not in an emergency situation.

This got me thinking: Do I ever really listen?

  • Am I really hearing what others are saying?  Or am I only passively listening?
  • Am I focused on their words?  Or am I thinking about what I will say next?
  • Am I putting myself in the shoes of the other?  Or am I only interested in meeting my objectives?
  • Am I hearing what they are really saying?  Or am I too colored by my own perceptions and judgments?
  • Do I ask a lot of questions?  Or am I the one doing all of the talking?

These are simple, yet useful questions to assess how well I am indeed listening.  And guess what, I (like most people) could be doing a much better job.

Our plane did not crash.  The back-up system worked perfectly.  When we landed the entire plane broke out into thunderous applause.

I am sure that everyone who was on that plane will be listening more intently the next time the emergency procedures are read during take-off.  And maybe they will also listen to friends, colleagues, and family members just a bit more carefully.  Maybe.

P.S. Less than 24 hours after the landing, JetBlue issued a $100 travel credit to everyone who was on that flight.  JetBlue is a class act. 

P.P.S. No, the picture was NOT our flight.  

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Innovation Costs on $0.50

March 4, 2012

I saw this sign while driving in Orlando.  It caught my attention.  As it turns out, there is very little innovation going on at Innovation Way.  Maybe they need to raise the toll.

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Reframe the Framework to Generate More Cash

March 3, 2012

This article originally appeared on the American Express OPEN Forum

The way we frame our business world can significantly impact our success. Frameworks are useful, but they can also be limiting. Perhaps it’s time to rethink the way things have been done in the past.

One useful framework is often called the product funnel or the accelerant curve. This framework typically refers to speakers, consultants, Internet businesses and those who create “intellectual property.” But the concept can be applied to any business, especially small businesses.

The general philosophy of the product funnel is to have products and services that increase in value so that you can continue to up-sell over time.

In this framework, customers enter your pipeline to buy a low- or no-cost item. This helps you to build trust, which in turn, lets you provide more robust solutions to your customers and put more money in your pocket.

I work with a lot of professional speakers. They would probably draw the curve as it is depicted to the right.

Most speakers offer a $25 product, typically a book. This is the low end of their curve. And, at the high end, they deliver a speech for which they charge $25,000.

Given this framework, the natural tendency is to fill in the curve with products priced in between. This might include CDs, DVDs, membership sites or coaching. They create a $250 product, a $750 offering and a $2,500 service.

The boundaries established by this framework—$25 and $25,000—delineate how you think about innovation.

While this tends to be the practice of most people who offer such services, looking at the curve this way may limit your true growth potential. Instead of $25,000 being at the top of the curve, what if it were actually near the bottom?

What if the top of the curve is closer to $1,000,000, or higher? If that is the case, you need to create products that are more than $25,000, not less. These could include assessments and diagnostics, consulting arrangements, sustainability programs that bring a speech to life over an extended period of time, or anything else that adds value.

From this example, you can see how the framework you create dictates your production. A small framework produces only the results that fit within that structure. Expanding your view opens up possibilities for greater value and financial gain.

This concept can apply to any business.

Are you a plumber? Maybe your typical project generates around $2,000. You may be tempted to offer a lower-cost option, perhaps a do-it-yourself kit, for only $200, which is valuable.

But what if, instead of $2,000 being the high-water mark for your services, you created a $200,000 offering? This would certainly get your creative juices flowing. Maybe, instead of selling your services to individuals, you target condominium associations, selling them an all-inclusive deal for every unit. It would challenge you to think bigger than you have thought before.

Are you a restaurateur? So many businesses offer their customers low-cost meals through Groupon or These may be reasonable entry points for your product funnel and are effective for driving new traffic.

But instead of focusing your efforts on smaller “transactions,” what if you shift your view to incorporate a higher-value, higher-dollar, relationship-driven option? How can you create a $10,000 meal?

Think big. Consider catering or developing an annual diet program that delivers meals to your customers to meet their dietary needs. Who knows what you will think of? But it is time to think big.

When you think small, you produce small.

You could even sabotage the business that you already have. I recently purchased a Groupon deal for a cleaning service. The owner’s hope was that Groupon would help her acquire new customers. She has been in business for seven years, but this low-price mindset might have killed her company. So many people subscribed that she could not adequately service her regular customers, let alone the new ones, and she risked losing them.

No matter what your business, avoid the “transactional” mindset. Find ways of engaging with your customers by providing both lower- and higher-priced offerings that will ultimately create a long-term relationship. But even more importantly, think big. Find ways of creating massive value, beyond anything you have considered before. Redraw your funnel or your curve by blowing the top off it.

How will you rethink your business?

Please comment on this article on the American Express OPEN Forum

Extra added bonus content:

When I originally posted this article on my Facebook page, someone commented that,

“The assumption that you are even worth $25,000 is a stretch for many folks. And for product companies, like shoes, for example, why spend hours thinking about a $200,000 shoe? Certainly that time would be better spent figuring out how to lower costs or enter new markets.”

Great point!  Here was my response:

“The usefulness of this concept depends on the evolution of your company. Regardless, it is a useful thought exercise. Most small businesses get stuck with a mental model which limits their thinking. I have this product, so this is what I sell. Just asking the question, ‘What product/service could I offer that is 10x what I offer today?’ can get a mature and established business thinking about bigger opportunities with greater leverage.

“And sometimes it is not about a bigger product.  For example, with my self published book, it is easier for me to sell 500 books to one client than it is to sell 500 books to 500 individuals. There is no leverage in the latter. Instead of a $15 sale, I discount and sell 500 in bulk for about $4,000.

“The question isn’t necessarily even new products but maybe different sales channels/methods for increasing $$ per sale.”

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